Thursday, on my way back from New York to Atlanta, I dropped into Raleigh, North Carolina to speak at a hyper local event called Entrepreneurs' Series: Venture Outlook, organized by local venture capital firm Bull City Venture Partners. It was standing room only as hundreds of startups and investors gathered to share their thoughts on the year ahead. Like Atlanta, Nashville, DC and other southeastern innovation centers, Raleigh might not be top of mind as a resource for a 2017 venture capital outlook--but it should be. Venture capital reboot is in the air this year as financial trends create a perfect climate for innovation--a climate best enjoyed outside of hot Silicon Valley valuations.
Here's a quick dive into some of the must-do's in this fortress city on the venture capital frontier:
Raleigh's claim-to-fame as a startup center
"Research Triangle Park has more PhDs per capita and is a center for tech companies, like Red Hat, Cisco, SAS, NetApp, EMC, Credit Suisse, IBM, and Lenovo," said David Jones, managing partner at Bull City Venture Partners, which is now on its third fund. "It boasts the density of three of the top research schools in the country -- UNC, Duke, and NC State within 20 minutes of each other."
He pointed out that in the last decade, the Triangle area ranks third, behind Silicon Valley and Washington, DC, for highest returns on venture capital invested. A growing list of Inc. 5000 companies call North Carolina home, like Tergus Pharma, nCino, and Appraisal Nation. So do a wide variety of startups from sectors as diverse as consumer products to healthcare IT, like BioResources International, The Produce Box, iScribes, and Medfusion.
The Raleigh investor connection
One of the most active angel groups in the region is VentureSouth. "We are here to make a market and make it more efficient. From the beginning our strategy is to invest in early stage companies across the southeast. We manage 11 angel groups, with 220 investors in our platform. Our investors meet once a month and we're a pass the hat model," says Matt Dunbar, Managing Director at VentureSouth "We're consistently writing half million dollar checks and often we're the first money in."
Another active voice is Anthony Pompliano, founder at Full Tilt Capital. "We think venture capital is broken." He's an active first check writer that's made 34 deals in the last six months. "The way we look at it is, is it possible for this team to actually build this company? If it is, we like to invest." That fresh, direct energy seems to be a hallmark of the Research Triangle entrepreneurial ecosystem.
The dealmaker's lunch
David Jones recommends Beyu Caffe in downtown Durham--you can often find one of the partners there meeting with an entrepreneur. Coffee in the morning, jazz at night--this local spot creates a uniquely North Carolina atmosphere.
Raleigh coworking capitols
"HQ Raleigh is where you want to be," recommends founder Justin Beard of Hip eCommerce, a collectibles marketplace. "It's the roadmap for what all co-working spaces here should do." Other standouts in the area include The Loading Dock, operated by Raleigh B-Corp, Murphey's Naturals, and First Flight, an incubator that's launched 275 startups since its founding. The American Underground, which launched in 2010 in the basement of the Strickland Building on the American Tobacco Campus, is a coworking space in North Carolina's largest historic renovation project. The one million square foot project transformed a derelict tobacco warehouses into a bustling hub for entrepreneurs.
Raleigh startup hero homebase
If you're landing in Raleigh, make one of your first stops the Council for Entrepreneurial Development, known by its initials, CED. Founded in 1984, this nonprofit puts on two signature annual events. Lindsay Burns, member relations manager, says ask about the new Capital and Connections program. It helps startups connect directly to capital sources and vice versa. In its first ten months, the program helped raise $55 million for area startups like Spoonflower and Zaloni.